Coforge to acquire Encora for $2bn, eyes $2.5bn revenue club; stock in focus on Dec 29

IT services major Coforge Ltd announced on Friday, after market hours, that it has signed agreements to acquire US-based Encora. 

The acquisition, pegged at an enterprise value of approximately $2.35 billion, is likely to propel Coforge into the elite $2.5 billion revenue club, creating a powerhouse focused on AI, cloud, and data services.

The stock is expected to be in sharp focus when the markets open on Monday, December 29. On Friday, shares of Coforge closed 3.70 per cent lower at Rs 1673.25 on the BSE against its previous close of Rs 1737.45 apiece. The counter has been facing selling pressure for the last three sessions, with the scrip down nearly 13 per cent in 2025 so far. 

Coforge will acquire Encora’s business from private equity giants Advent International, Warburg Pincus, and other minority shareholders. The deal will be funded through a preferential allotment of equity shares worth approximately $1.89 billion. Post-transaction, Encora’s shareholders will hold approximately 20 per cent of the expanded share capital of Coforge.

This "all-stock deal" signals that the incoming investors are rolling over their stakes, betting on the long-term growth of the combined entity rather than cashing out.

Sudhir Singh, CEO and Executive Director of Coforge, termed the move a ‘defining moment’ for the organisation. "The new $2.5bn firm, with a $2bn enterprise core of AI-led engineering, data and cloud services, will set the benchmark on making the promise of AI real for enterprises," Singh said. 

He added that with this augmented core, the company believes their growth will get further accelerated and move to an even higher orbit.

Target Prices

While the market reacts to this fresh development on Monday, analysts have already been bullish on the stock earlier this month.

Motilal Oswal, in a note dated December 9, 2025, had reiterated a ‘Buy’ rating with a target price of Rs 3,000.

Axis Direct, in its update on the same day, recommended a ‘Buy’ with a target price of Rs 2,300, citing the company's competitive positioning and operational improvements.

ICICI Direct also maintained a ‘Buy’ rating with a target price of Rs 2,230, noting that the company is engineered for outperformance with a target period of 12 months.